Student loans body seeks right to demand full repayment

The Swedish Board for Study Support (CSN) is to escalate its hunt for outstanding loans and wants the right to demand full repayment from overseas defaulters, Sveriges Radio (SR) reports.

Student loans body seeks right to demand full repayment

In recent years the board has taken steps to ensure that Swedes resident overseas do not get away with neglecting to pay back their outstanding student loans.

The board has employed debt collections agencies, scoured social networking sites such as Facebook, and enlisted the help of lawyers in several countries to track down defaulters.

CSN now hopes that the Swedish government will grant the right to demand full repayment of student loans from overseas defaulters, a measure that it argues could provide sufficient incentive to those currently evading payment.

“It will quite simply strengthen the resolve to repay,” CSN’s director-general Kerstin Borg Wallin told SR’s Ekot news program.

It is reported that a government bill to be presented in the autumn is expected to grant the additional powers to assist CSN in obliging defaulters to meet their obligations.

According to CSN more than 25 percent of debtors resident overseas are in serious default – owing a total of 3 billion kronor ($380 million) to the Swedish state. By comparison only three percent of debtors resident in Sweden neglect to meet their obligations.

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Students to keep paying off debt beyond 67

The Swedish government has proposed scrapping the 25-year span for repaying student loans, by suggesting those who attend higher education should keep paying the money back well into retirement.

Students to keep paying off debt beyond 67

At present some 200,000 students have their student loan written off every year when they reach the age of 67. However, proposals in the government's spring government bill are set to increase the financial burden on students. 

Along with the idea of extending the debt into old age, the government are going to more than double the fee when students get a late payment reminder.

It is presently 250 kronor ($38) but will go up to 450 kronor if the reform is passed. The move follows hot on the heels of a government u-turn to cut student grant by 300 kronor a month.

Finance minister Anders Borg has justified the moves by saying that all reforms must be paid for krona by krona.

The Swedish National Union of Students (Sveriges förenade studentkårer) criticized the government proposals, arguing that the level of debt already continues to increase.

"We are strongly opposed to this debt and collection politics which is obviously a strategy to pay for higher education. The past few years the debt burden has increased every year," chairman Erik Arroy told the TT news agency. 

He added; "It's fair that you repay your loans. However, we don't find it reasonable that you are expected to put yourself in debt as much as they assume people will do today." 
Meanwhile the Swedish student grant agency (CSN) said the proposed reform will mean they are dealing with a new, older, range of people in the future. 
"We will have a new group to work with and it's pensioners," Boel Magnusson of CSN told TT. 
She added that the full impact on CSN will not be known until an analysis on the proposal has been carried out. 
The Local/pr